The following units of an item were available for sale during the year: Beginning inventory 21,600 units at $20.00 Sale 14,400 units at $40.00 First purchase 48,000 units at $25.20 Sale 36,000 units at $40.00 Second purchase 45,000 units at $26.40 Sale 33,000 units at $40.00 The firm uses the perpetual inventory system, and there are 31,200 units of the item on hand at the end of the year. What is the total cost of the ending inventory according to (a) FIFO, (b) LIFO

Ending inventory are the inventories of a company that were left unsold at the end of a business period. In this question, the ending inventory is 33,000.

LIFO means last in first out. It means that it is the last purchased inventory that is the first to be sold. Ending inventory would be made up of inventories that were purchased the earliest.

The ending inventory would be taken from the beginning inventory and part of the first purchase.

Ending inventory = (21,600 x 20) + [(31,200 - 21,600) x 25.20]

= 432,000 + 241,920 = $673,920

FIFO means first in, first out. It means that it is the first purchased inventory that is the first to be sold.. Ending inventory would be made up of inventories that were purchased the latest.

The ending inventory would be taken from part of the second purchase.

Ending inventory = 31,200 x 26.40 = 823,680

To learn more about FIFO, please check: https://brainly.com/question/294129

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